Astro Company sold 29,000 units of its only product and reported income of $37,800 for the...

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Astro Company sold 29,000 units of its only product and reported income of $37,800 for the current year. During a planning session for next year's activities, the production manager notes that variable costs can be reduced 50% by installing a machine that automates several operations. To obtain these savings, the company must increase its annual fixed costs by $141,000. Total units sold and the selling price per unit will not change. ASTRO COMPANY Contribution Margin Income Statement For Year Ended December 31 Sales ($50 per unit) Variable costs ($48 per unit) Contribution margin Fixed costs Income $ 1,450,000 1,392,000 58,000 20,200 $ 37,800 1. Compute the break-even point in dollar sales for next year assuming the machine is installed. (Round your answers to 2 decimal places.) Contribution Margin per unit Proposed $ Contribution Margin Ratio Numerator: Break-even point in dollar sales with new machine: Numerator: 0.00 Denominator: = Contribution Margin Ratio = Contribution margin ratio 0 Denominator: = = Break-Even Point in Dollars Break-even point in dollars 0 Astro Company sold 29,000 units of its only product and reported income of $37,800 for the current year. During a planning session for next year's activities, the production manager notes that variable costs can be reduced 50% by installing a machine that automates several operations. To obtain these savings, the company must increase its annual fixed costs by $141,000. Total units sold and the selling price per unit will not change. ASTRO COMPANY Contribution Margin Income Statement For Year Ended December 31 Sales ($50 per unit) Variable costs ($48 per unit) Contribution margin Fixed costs Income $ 1,450,000 1,392,000 58,000 20,200 $ 37,800 1. Compute the break-even point in dollar sales for next year assuming the machine is installed. (Round your answers to 2 decimal places.) Contribution Margin per unit Proposed $ Contribution Margin Ratio Numerator: Break-even point in dollar sales with new machine: Numerator: 0.00 Denominator: = Contribution Margin Ratio = Contribution margin ratio 0 Denominator: = = Break-Even Point in Dollars Break-even point in dollars 0

Answer rating: 100% (QA)

Given Data Current Contribution Margin per unit 2 50 48 Proposed reduction in variable costs 50 Incr... View the full answer